In this article, they explain about the Fast Fashion Brands. which speaks about the different sourcing strategies both the companies have and how this affects. In the clothing Industry firms compete successfully by applying different business models. H&M’s and ZARA’s are two extremes in the clothing industry. H&M business model mainly focuses on outsourcing. ZARA’s business model mainly focuses on in-house production.The problem is that the existing theories alone cannot explain why two firms competing in the same environment under the same conditions choose different business modals.
The clothing firm, H&M, is a firm that outsource none-core operation.H&M does not own any factories, instead H&M buys clothes and other items through an abundance of detached suppliers.
The business model of the clothing firm ZARA is the opposite compared to H&M. ZARA is one of the fastest growing retailers and belonging to the Spanish Inditex Group. ZARA has developed a unique business modle and today ZARA is a vertically integrated retailer. ZARA controls every of the value chain, only clothes with a longer shelf/fashion life time are outsourced.
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https://www.grin.com/document/310193
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